What do these sectors—solar energy, wind, gold, Spain, Italy, steel, metals and mining, and retail—have in common?
They’re all among market leaders today. ETFs (exchange traded funds) in these sectors are outpacing the Standard & Poor’s 500 (up 0.5% as of 12:25 ET). Claymore/MAC Global Solar Energy (TAN) was up 4.7%. First Trust Global Wind Energy (FAN) was up 3.1%. Market Vectors Gold Miners (GDX) was up 3%. iShares MSCI Spain (EWP) was up 2.7%. iShares MSCI Italy (EWI) was up 2.6%. Market Vectors Steel (SLX) was up 2.7%. SPDR S&P Metals and Mining (XME) was up 2.5%. And Retail HLDRS (RTH) was up 2.3%.
It sure looks like investors have recovered their appetite for risk—and maybe their belief in the global economic recovery.
Some of these sectors—steel, and metals and mining, for example—are among those hit hardest in the recent almost correction based on fears that tighter restrictions on lending in China would damp the global recovery. Others—Spain and Italy, for example—have been in the headlines of the crisis in the euro.
One day doesn’t make a trend—but I think we could put together a tidy move in this direction that lasts two or three weeks. Or at least until stocks get over bought again and bump up against the top of their trading range again at 1140 to 1150 on the S&P 500 index.
After that, I think it will take some real, positive data to keep this upward trend running.